Dividends paid from the profits of oil companies will no longer be
tax-exempt if the finance bill submitted by President Muhammadu Buhari
is passed by the national assembly.
This was contained in a statement released by Yunusa Abdullahi,
special adviser on media and communication to Zainab Ahmed, the
minister of finance, budget and national planning, on Tuesday.
“This bill seeks to improve revenue by removing the tax exemption
granted for dividends or income received from companies charged under
the petroleum profits tax act,” the minister was quoted to have said.
“The bill contains some changes to the companies income tax act,
value-added tax act, petroleum profits tax act, personal income tax
act, capital gains tax act, customs and excise tariff act and stamp
duties act.
“The bill also seeks to address the taxation of industries, such as
insurance, start-ups, and the capital markets, evaluated by the
federal government as critical to the growth and development of the
Nigerian economy with a view to stimulating activities in those
sectors and fostering overall economic growth.”
The president had submitted the 2020 budget proposal to the national
assembly alongside the finance bill.
The bill has already scaled second reading at the legislative chambers.
Providing other details of the bill, Ahmed said capital gains tax
amendment will cover the taxation of business combination and seeks to
prevent abuse of a provision of the act on group restructuring.
In the area of stamp duties, the minister said the new bill will work
towards increasing revenue generation from duties on electronic
stamps.
While presenting the bill, Buhari had said it would fiscal equity by
mitigating instances of regressive taxation; reform domestic tax laws
to align with global best practices and introduce tax incentives for
investments in infrastructure and capital markets.
